While we're always a little sorry to lose a client, when we see our borrowers pay off loans to refinance with another institution, we see that as an opportunity for a mini-celebration. Let me explain: AEDC is a gap lender and we often make what are perceived as higher risk loans- for start up businesses and expansions. While many financial institutions are obligated to make the most secure loans possible, AEDC's is committed to supporting economic development by helping businesses grow and expand.

This means we have flexibility to look at a business' projections, instead of relying on their financial history to decide if they're credit-worthy. That is especially helpful when we work with a new business but also offers more opportunities to work with existing businesses that are expanding because projections can be considered when assessing their ability to repay a loan. AEDC also has some flexibility to look at an entire package and work with clients on issues like a less that desirable credit rating or insufficient collateral.

We sometimes refer to our clients as "nearly bankable" But AEDC DOES make good lending decisions, and when a business plan is strong, we want to fund it. And when our client goes from "nearly bankable" to securing a bank loan, we know we've succeeded in helping that business grow and prosper.

Celebrations

Poletski's Payoff

There aren't many lenders that hope their clients move on but sometimes that is exactly the goal at AEDC. Eel Valley Appliances is the latest example of that success.

In 2011, Rick and Dama Poletski secured a start up loan from AEDC to purchase the Fortuna appliance store after an unsuccessful attempt to obtain conventional funding. "We were challenged because there were not many assets," recalled Dama Poletski. "We were looking at mostly an inventory purchase so we could not qualify under conventional requirements."

After buying the business, the Poletski's focused on improving the business with technology improvements, visual upgrades, and increasing the level of customer

service. The hard work paid off. "Now that the business has been established in our names and we've been successful. We were able to obtain conventional financing with Redwood Capital Bank and decrease our interest rate substantially," Poletski said.

"Our goal at AEDC is to help small businesses succeed," observed Susan Seaman, Program Director at AEDC. "We can't compete with most conventional lenders' interest rates but can often provide higher risk financing when others can't. We're a great stop-gap. When our clients are able to move on to more conventional lending at a lower rate, that means their business is healthy and contributing to the economic health of our community."

New IDA Program

New Siskiyou County

IDA Program

AEDC is pleased to announce the launch of a new IDA program in Siskiyou County.

Thanks to a grant from the Department of Health and Human Services Assets for Independence (AFI) and a financial commitment from Jefferson Economic Development Institute (JEDI),

Siskiyou County IDA Orientation

eligible business owners will be part of a savings match program where they will receive $3 for every $1 they save. They will also participate in financial literacy workshops, business education workshops, one-on-one advising, and complete a business plan. At the end of the program, participants can use accrued funds for business assets, professional training and/or other business enhancing investments.

This is the second partnership for the IDA program with JEDI, bringing together Jefferson Economic Development Corporation as the education coordinators, Scott Valley Bank as the account holder for participants, and AEDC as the program coordinator and fund distributor.

Come learn about what's been happening with AEDC in the past year while enjoying food, wine and networking.

To RSVP or get more information, call 707.822-4616

SBA Commercial Property 504 rates

SBA 504 Current

Rate:

5.00%

Low down payment for borrowers

Competitive fixed interest rate

Long Term loan

From $50,000 to $5 million for commercial real estate, construction and equipment acquisition.

Many commercial loans available on the market require a sizeable percentage down before the loan will be granted, and this can be an obstacle for many business owners looking to improve their facilities. The SBA 504 Loan offers a solution for that -- you can borrow up to 90% of your financing needs at a fixed rate, so only a minimum of 10% down is required.

The remainder is split between the SBA loan (40%) and a bank loan (50%), and the Arcata Economic Development Corporation will work with your bank to submit your loan application. Loan amounts range from $50,000 to $5 million, and some restrictions apply.

Are you ready to build a better Humboldt?

The Humboldt Business Challenge is an innovative local business competition designed to identify and encourage new business start-ups, as well as help grow existing businesses in Humboldt County. The competition will allow entrepreneurs to vet their ideas and connect them with the people and resources needed to succeed while competing for cash and in-­kind awards.

The competition is open to Humboldt County's aspiring entrepreneurs as well as existing businesses who are considering introducing new products or entering into new markets.

For more information, call 707-273-2985 or visit

www.humboldtbusinesschallenge.org

Partner News

Redwood Coast Connect 8th Annual Forum

You are invited to attend the 8th annual Redwood Coast Broadband Forum to hear the latest news on Broadband for the North Coast.

You may know that in 36 years as a commercial lender, AEDC has helped many of Arcata's most notable businesses, including Kokatat, Los Bagels, Holly Yashi and Jessicurl. AEDC has also worked with Organic Grace in Garberville, Hoppy's Fro-Yo in Fortuna, Open Door Community Health in Eureka and Geiger's Long Valley Market in Laytonville. Surprised? Here are some things you might not know about AEDC:

* AEDC serves more than Arcata *

When it started in 1978, AEDC provided lending services specifically to the city of Arcata. But we've evolved into more of an "All Over" Economic Development Corporation, offering funding in six counties including Humboldt, Del Norte, Mendocino, Lake, Trinity and Siskiyou.

** AEDC helps more than just start-ups **

AEDC funds businesses with strong business plans that can't find funding through traditional lenders. Often, these are start-ups, but existing business can have challenges securing bank financing too. With commercial lenders, sometimes changes to business structure or mission can increase funding risk and disqualify them. In addition, businesses wanting to purchase commercial property may discover that an SBA 504 Loan from AEDC in partnership with another financial institution is the best solution.

*** AEDC can loan ***

from

$5,000 to $5 million

For some small business owners, $5,000 is a daunting figure and can even be enough to stand in the way of doing business. For a conventional lender, though, a small loan can take almost the same amount of work as a large loan and borrowers are sometimes discouraged from applying, if they can find a funder at all.

Thankfully, at AEDC, our mission is to support business development with the funding they need, regardless of the size of the loan. We fund $5,000 loans and through the SBA 504 program, we can also fund up to $5 million dollars for commercial property. While most of AEDC's loans usually fall somewhere between $85,000 and $150,000, AEDC has the funding sources to serve business needs big or small.

* * *

We are proud of the variety of businesses we've served over the years at AEDC. We would love to include you in our family of success stories.

Visit www.aedc1.org to get more information about AEDC loans, events and programs.